Study States Toyota Recalls Didn’t Affect Brand
A recent study produced at North Carolina State University suggests that customer perception of the Toyota brand may not have been affected by the safety recalls that occurred in 2009. Those recalls were due to a malfunction that caused certain Toyota models to accelerate suddenly, which was widely covered by the media. About 9 million vehicles were brought back to dealerships around the country, and many analysts feared that the Toyota brand would suffer irreparable damage.Shortly after the recalls originally occurred, Kelley Blue Book lowered its Toyota prices roughly 4 percent. That translated to a reduction in value of between $300 and $750 in a very short period of time, which fueled speculation of a damaged reputation. Similar Audi recalls in the 1980s resulted in a 16 percent slide, and it looked like the same thing might happen to Toyota.
Despite the dire outlook, some people retained faith in the strength of the Toyota brand. Michelle Krebs, who was an Edmunds analyst at the time, advised Toyota owners to hold onto their vehicles. “Values will stay down for a bit,” she said. “But Toyota’s got really strong brand equity.”
According to the North Carolina University study, which was carried out by Dr. Robert Hammond, it appears that Krebs was right. The study dealt with used car sales, which did decline initially, but prices leveled off by 2010. Overall, the study suggests that Toyota prices are down around 2 percent in comparison to similar used Honda models.
Dr. Hammond, who was also responsible for the Audi study in the 1980s, says that the difference between Toyota and Honda prices is well within the statistical margin of error for the study. That indicates the Toyota brand was probably not affected by the recalls.
Filed Under: Auto News